TMI Blog2014 (12) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... part of De-linking plant was sold which is described as ‘De-linking Cell’ on which respondent paid duty amount of ₹ 1,84,000/-. There is no allegation in the show cause notice dated 23.09.2004 that De-linking plant was sold as such and not after use. There is no specific finding of the lower authorities that De-linking plant was sold as such in the guise of scrap. There is no evidence on record that entire De-linking plant on which service tax credit ₹ 13,79,969/- was removed by the respondent. Thus for removing a part of De-linking plant after use on payment of duty, entire cenvat credit can not to be denied - Following decision of CCE, Chandigarh vs. Raghav Alloys Limited [2010 (4) TMI 294 - PUNJAB & HARYANA HIGH COURT] - Dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia Limited - [2007 (219) ELT 911 (Tri. Mum.)] (c) Navodhaya Plastic Inds. Limited - [2013 (298) ELT 541 (LB) 3.1 It was his case that only a part of the capital goods (De-inking Cell) was cleared as waste and scrap as per second paragraph of the show cause notice dated 23.09.2004. It was also argued by learned advocate that adjudicating authority has gone beyond the scope of show cause notice while arguing that capital goods were never put to use. Learned advocate made the Bench go through paragraph 16 of the OIO dated 20.12.2006 and argued that only De-Inking cell was removed by the respondent which was a part of De-Inking Plant imported by respondent; that entire service tax credit of ₹ 13,79,969/- was availed with respect to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame has become in-serviceable and fit to be scrapped. The object of Cenvat Credit on capital goods is to avoid the cascading effect of duty. If even after use for a couple of years, the Cenvat Credit is required to be reversed then it would certainly defeat the object of the scheme. To avoid misuse of the scheme in the Rules, it has been provided that if the machines are cleared as such the Assessee shall be liable to pay duty equal to amount of Cenvat Credit availed. The machines which are cleared after utilization cannot be treated as machines cleared as such. With effect from 13-11-2007, a proviso has been added to Rule 3(5) of the Cenvat Credit Rules providing that if the capital goods on which Cenvat credit has been taken are removed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect to the entire De-linking Plant imported whereas a part of De-linking plant was sold which is described as De-linking Cell on which respondent paid duty amount of ₹ 1,84,000/-. There is no allegation in the show cause notice dated 23.09.2004 that De-linking plant was sold as such and not after use. There is no specific finding of the lower authorities that De-linking plant was sold as such in the guise of scrap. There is no evidence on record that entire De-linking plant on which service tax credit ₹ 13,79,969/- was removed by the respondent. Thus for removing a part of De-linking plant after use on payment of duty, entire cenvat credit can not to be denied. In view of the above observations the appeal filed by the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X
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